GST and its Role in Higher Education and its emerging impact on the field

One of the most talked about thing in the country right now is GST. The influence of GST has been evident in almost every sector including education. The area in education that has seen the maximum effect of GST is Higher education.

GST in Higher Education

GST in Higher Education Vs Educational Institutions

The onset of GST has increased the fees of higher education. The service tax which used to be 15.5% has risen to 18%. As a result fee of courses has increased by 2.5%. However GST is exempted on services provided by educational institutions. These services were segregated and finalised even before the GST was applied into full action

Vikalp Jain, President and Co-Founder, Acadgild states that “The introduction of GST has brought about a lot of ambiguity. We are still in the process of understanding GST and its implications”

GST in Higher Education

The Impact of GST

The impact of GST has been less on Skill development courses. Increased GST rates have hit Higher education courses the most.

“Given all the emphasis on skilling people, there was an expectation that skill-based courses will have a much lower GST on them. However, the 18% GST levied on them will impact imparting higher education in a major way” adds Vikalp Jain, President and Co-Founder, Acadgild

Any Services provided as input to higher educational institutions comes under taxable. In some of such ‘input’ services utilised by higher educational institutions like housekeeping, transportation, examination conduct etc., service tax is usually levied. This practice will continue even after GST has become operational.

“The GST exemption in education is included for providing education (which is tax free as a service) and on procurement services utilised by primary schools,” explains Prof. Deepanshu Mohan, Executive Director Centre for New Economics Study,‎ Jindal Institute of International Affairs (JSIA), OP Jindal Global University

GST in Higher Education

Fate of GST

In an emerging Education Market like India, the expensive higher education will be a huge drawback as It is deterrent to the growth of Higher Education sector in India. The government should take measures to lessen the burden of GST since this will make sure that more students are able to go for Higher Education